Analysis: The Current State of the China-Taiwan Spy War

By JOSEPH FITSANAKIS | intelNews.org |
Last week I spoke about the current state of the espionage war between China and Taiwan with Tim Daiss, a Southeast Asia-based American journalist who has been covering the Asia-Pacific region for over a decade. Our discussion formed the basis of a comprehensive piece on the subject, published in British newspaper The Independent, in two parts (part one and part two). I told Daiss that the Ministry of State Security —China’s primary national intelligence agency— is not known for its technological prowess. However, the sheer size of Beijing’s intelligence apparatus is proving a good match for the more advanced automated systems used by its less populous regional rivals, including Taiwan. When it comes to traditional human intelligence, the Chinese have been known to employ time-tested methods such as sexual entrapment or blackmail, as was confirmed most recently in the case of Taiwanese Major-General Lo Hsien-che. Lo, who headed the Taiwanese military’s Office of Communications and Information, was convicted of sharing classified top-secret information with a female Chinese operative in her early 30s, who held an Australian passport. During his trial, which marked the culmination of Taiwan’s biggest spy scandal in over half a century, Lo admitted that the Chinese female spy “cajoled him with sex and money”. In addition to honey-trap techniques, Chinese spies collect intelligence by way of bribery, as do many of their foreign colleagues. In the case of China, however, a notable change in recent years has been the accumulation of unprecedented amounts of foreign currency, which make it easier for Chinese intelligence operatives to entice foreign assets, such as disgruntled or near-bankrupt state employees, to sell classified data.

In the case of Taiwan, China’s primary intelligence targets are weapons systems, especially those originating in the United States. The island-nation possesses export-versions of some of America’s most advanced weaponry, and it is far easier for Beijing to access such weapons in Taiwan than on US soil. Taiwan is both geographically and culturally familiar to Chinese intelligence operatives, who do not have to try too hard to blend into Taiwanese society. I told The Independent that, based on publicly available information about recent espionage cases, it would be safe to assume that Chinese intelligence has gained access to substantial classified information on some of Taiwan’s most advanced US-made defense systems. These include the Lockheed Martin/Raytheon-built Patriot missile defense system deployed on the island, as well as the Po Shen command and control system, which is designed to facilitate critical battlefield communications between Taiwan’s navy, army and air force.

I argue in the interview with the London-based paper that China’s success in penetrating Taiwan’s defense systems is having a significant impact on bilateral relations between Washington and Taipei. On the one hand, the United States is committed on preserving its alliance with Taiwan, for both geostrategic and symbolic purposes. But, on the other hand, American defense planners are weary of the damage caused to US military strategy by the exposure of some of Washington’s most coveted weapons systems to Chinese intelligence by way of Taiwan. As I told Daiss, while nobody at the US Pentagon or State Department would admit it publicly, “many in Washington are increasingly hesitant to supply Taiwan with sensitive military technology because they fear penetration by the Chinese”.

At the end of the interview, I cautioned that it would be a mistake to view the United States and Taiwan as simply passive receptors of Chinese intelligence activities. The increasing ease of travel and communication between Taiwan and the Chinese mainland in recent years has allowed Taiwan’s military and civilian intelligence agencies to collect far more intelligence on China than ever before. Their activities range from cyberespionage and offensive counterintelligence to sexual entrapment (some intelNews readers may recall the 2006 case of Tong Daning, an economist in China’s Social Security Department, who was executed in 2006 for sharing classified Chinese economic data with his mistress; she later turned out to have been a spy for Taipei).

Ultimately, however, it is near impossible for Taiwan to match the size of China’s spy network, even with American assistance. As Daiss writes, “twenty-four million versus 1.3 billion just doesn’t seem like a fair fight”. And, he adds, “how all of this will unfold as China and Taiwan continue to forge relations in the near future is anybody’s guess”.

The various Chinese intelligence services, and I assume there are a number, having a very interesting characteristic signature. They wil deal only with their own citizens or ethnic Chinese living abroad. Use at times as a proxy to approach and recruit for whatever means those nationals not Chinese but nonetheless the Chinese normally only willing to work with their own people.

I’m wondering whether China has also penetrated the South Korean and Japanese national security establishments on a large scale? While there are ethnic differences these countries lie in China’s expanding sphere of influence.

@Pete: The attraction of Taiwan for Chinese intelligence is that its operatives can blend in relatively effortlessly, so the deployment of non-official-cover operatives tends to be regular. This is not the case with Japan and Korea. In the latter case, China relies partly on North Korean intelligence HUMINT collection. [JF]

@Joseph: Yes Taiwan may be tempted to massage its intelligence in a way favourable to Taiwan’s bilateral relations with the US – put another way exaggerating the threat from China to Taiwan and the US.

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